SAN JOSE, Costa Rica (AFP) –
Chinese President Hu Jintao began a Latin America tour with the launch of free trade talks with Costa Rica on Monday, just over a year after the country gave up six decades of ties with Taiwan.
Hu's stopover was the highest-level visit by a Chinese official to Costa Rica and came as China
expands its diplomacy and investment on the whole continent, with an
eye on natural resources and developing markets for manufactured goods
and even weapons.
Hu arrived in San Jose Sunday, from a G20 summit in Washington, and headed Monday for his second visit to communist ally Cuba, before attending an Asia-Pacific summit in Peru on November 22.
"The development of cooperation and friendship between China and Costa
Rica meets the fundamental interests of our people and will also
support different sectors of our societies," Hu said after announcing
the free trade deal with President Oscar Arias.
Talks were due to start January 19, 2009, in San Jose and end before Arias leaves office in May 2010.
Hu and Arias, who visited China last year, oversaw the signing of 11 cooperation deals, from setting up a Chinese language institute to opening a line of 40 million dollars in credit from China.
They agreed to set up a joint venture including China's National
Petroleum Corporation to help modernize Costa Rica's state-owned oil refinery, with an investment of up to 1.2 billion dollars.
Hu's symbolic visit made the point that Central America
was no longer a Taiwanese stronghold, after Costa Rica became the first
country in the region to establish diplomatic ties with China on June
1, 2007.
Both Taiwan -- a democratic self-ruled island that Beijing considers part of its territory awaiting reunification -- and China have been accused of using so-called "dollar diplomacy" to get nations to ally with them.
But Taiwan has lost allies in recent years.
Part of China's incentives for Costa Rica's recognition came from its enormous foreign exchange reserves
with an offer to buy 300 million dollars in bonds. It also donated more
than 100 million dollars to build a new national stadium.
Costa Rica is only the third Latin American country to negotiate a free trade deal with China, after Chile and Peru, which may conclude its accord during Hu's visit later this month.
A major exporter of computer components, Costa Rica has dismissed fears
of an invasion of Chinese products into the country as it seeks to
diversify ties amid worldwide financial woes.
Its main trade partner is the United States.
Arias, a Nobel Peace Prize winner, said the two leaders had not touched on China's widely criticized human rights record.
"I used the opportunity to speak of things that are important and urgent for Costa Rica," Arias said.
Hu headed to Cuba late Monday, less than two weeks before the arrival of Russian President Dmitry Medvedev.
China offered key support to former Cuban leader Fidel Castro when Cuba fell into dire economic straits after the 1991 breakup of the former Soviet Union, forging a divide with Russia.
China was Cuba's second business partner, after Venezuela, in 2007.
Source: Yahoo! News - by Sophie Nicholson Sophie Nicholson
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Mon Nov 17, 5:03 pm ET